A common change management statistic that scares businesses across a variety of industries says that 70 percent of change initiatives fail. Evidence has emerged that the 70 percent stat is a myth, but many mortgage professionals still hold onto the fear of moving from an existing strategy or solution, even if it is a hindrance to success. As a result, they may never move on from an inefficient LOS, worried that changing providers is too risky.
The reality is that it’s actually riskier to not embrace change—especially when your team needs streamlined processes, a decent volume of loan originations, and satisfied borrowers to thrive in today’s mortgage environment. Here is a deeper look at why an experienced LOS provider can be key to improving your mortgage operation:
The Challenge of Change
Change management often gets a bad rap because it costs time and money. Many lenders fear that switching to a new LOS will be technically difficult, data will be lost during implementation, training loan officers and other key personnel on the new platform will be a hassle, and/or the cost will be prohibitive, with little hope for a return on investment.
A top-notch LOS provider can help ease those fears. Providers can streamline implementation, coordinate training, and deliver unparalleled performance once the software is up and running. In today’s mortgage market, banks and credit unions rely on volume—with the rise of the non-bank lender, “traditional” mortgage operations need to originate more loans to maintain profits. Implementing a more efficient LOS helps achieve this goal and realize a greater ROI than struggling with a system that is deficient on many fronts.
Another barrier to change might be the previous investment in a current LOS. That LOS to which you seemingly just yesterday devoted a good chunk of capital could be nearly a decade old. If your system feels like it’s stuck in the past, it’s not doing you or your customers any good. A bold change is an investment, and with the right LOS, that investment will pay off sooner than you think.
Skip the Third-Party Consultants
Another common reason lenders are resistant to change their LOS is they think they’ll need to hire third-party consultants to implement a new solution. That strategy often results in a large expense, a long implementation, and a complicated configuration. The common alternative is to keep an underperforming LOS rather than deal with the complexity and expense of tabbing a consultant for a new system.
A great LOS designed by a provider with extensive industry experience solves this problem by taking the consultant out of the equation. Instead of working through a third-party, you’ll work directly with a vendor whose success is your success. These providers aim to efficiently install their system and train your team until they are experts at using the software. Established providers have seen it all, and they can rely on previous experience and industry expertise to help you manage internal obstacles, external challenges, and borrowers’ needs.
Strong Customer Service
Lenders may also be hesitant to switch to another LOS because they think that they will be on their own before, during, and after implementation. However, a provider with a history of excellence and innovation in the mortgage technology space likely also brings customer service chops that extend far beyond implementation.
Such a vendor delivers support when you need it, sends updates as warranted, and remains a partner that is invested in your continued success. Changing software doesn’t seem so daunting when you know technical help is only a phone call or email away.
A Plan for Future Change
Of course, the new LOS you adopt today may not meet your needs three, five, or 10 years down the road. Technology and the mortgage industry will evolve, and your loan operation may also expand in that time. Although you want software to match progressing needs, you don’t want to be having this same conversation in several years.
Therefore, it’s important to choose a provider with not only a track record of excellence but also the foresight and priority to regularly update and upgrade its solution. A vendor that makes scalability a priority delivers an LOS that grows as your operation grows. Change becomes less scary because your software partner is with you every step of the way—no matter what the future holds for your financial institution.